- Buybacks and dividends continuously exceed earnings creating a financialized corporate environment and leaving less money for innovation and investments.
- Such a situation isn’t sustainable in the long term.
- We’ll close with an example of somebody willing to spend $21.5 billion of shareholders’ money to increase his salary by a few million.
The end of each quarter is an excellent time to analyze what’s going on with buybacks and dividends. FactSet’s comprehensive analysis of quarterly buybacks and dividends for the S&P 500 is a great place to start.
It’s of extreme importance to know what it is that management is doing with your money and if they are increasing or decreasing shareholder value. Today, we’ll analyze the situation and give you a few hints to enable you to easily analyze if the managers of the stocks you own add or subtract value with dividends and buybacks. More →